Category Archives: Economic Analysis

The Once-in-3-Billion-Year Treasury Move That is Not so Rare

I agree with most of what Jamie Dimon, the head of JPMorgan Chase & Co., said about the Treasury market recently but I disagree that the gyration in yields that occurred on October 15 of last year was an “unprecedented … Continue reading

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The Game of the Best of All Possible Worlds and Financial Virtual Reality

Both stocks and bonds rallied after the release of the Fed’s statement yesterday, causing investment euphoria and hopes that the best of all possible worlds, where yields are low and stocks make constantly new all-time highs, will continue. This game … Continue reading

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Interest Rate Increase Talk is Unfounded

The Personal Consumption Expenditures Price Index (PCEPI) YoY changes are at levels seen during the Great Recession. Any talk about an interest rate increase is unfounded given the data but it suites those who are looking to buy at lower … Continue reading

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Why There Won’t Be An Interest Rate Increase Anytime Soon

A market trend reversal due to rising interest rates won’t happen anytime soon because the Fed won’t act in the foreseeable future. However, a major market correction could happen due to other reasons, even more important than rising rates. Share

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Stock Market Rally to New Highs Mainly Driven by High Beta Stock Picking

The S&P 500 index made a new all-time high last Friday but the rally was mainly driven by large cap high beta stocks and the low volatility group is lagging behind. This is also evident from the price action in … Continue reading

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Baltic Dry Index Falls to a 28-Year Low

Due to an oversupply of vessels and slowing economic activity, the Baltic Dry Index fell to a 28-year low of 608 on Friday with the shipping industry facing tough times ahead. Share

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The Draghi Effect and the Overleveraged Funds

I have lost count of how many times Mr. Draghi has promised sovereign bond buying. But for now, all the ECB does is accepting sovereign bonds as collateral and has not printed money in exchange for paper. The reason is … Continue reading

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